4. General Motors Company (NYSE:GM)
Number of Hedge Fund Holders: 90
General Motors Company (NYSE:GM) is a Michigan-based automobile manufacturer, selling its vehicles and accessories across North America, the Asia Pacific, the Middle East, Africa, South America, the United States, and China. Berkshire Hathaway’s General Motors Company (NYSE:GM) position dates back to Q1 2012, and in the fourth quarter of 2021, the hedge fund held General Motors Company (NYSE:GM) shares worth $3.5 billion, accounting for 1.06% of the total portfolio.
On March 15, Jefferies analyst Philippe Houchois lowered the price target on General Motors Company (NYSE:GM) to $44 from $53 and kept a Hold rating on the shares. To account for “a stagflationary environment” in the automobile sector, the analyst has started adjusting estimates for greater input costs, supply chain challenges, as well as price and “potential demand destruction”.
Harris Associates is a leading shareholder of General Motors Company (NYSE:GM), owning 33.4 million shares worth $1.96 billion. Overall, 90 hedge funds were bullish on the stock at the end of December 2021.
Here is what RLT Capital has to say about General Motors Company (NYSE:GM) in its Q4 2021 investor letter:
“Despite my enthusiasm for GM’s competitive positioning in the years to come, it’s the decidedly unsexy legacy operations that keep GM’s cash registers ringing in the here and now. On that front, investor enthusiasm for the current manufacturing – and financing – of internal combustion engines remains pretty muted by most measures. And understandably so:
-GM’s operations are capital intensive,
-GM’s marketplace is highly competitive (and with excess capacity to boot),
-GM’s supply chain is super complex (e.g., semi shortage, tariffs, etc),
-GM’s labor force is (very) unionized,
-GM’s liabilities are aplenty and long-dated (e.g., warranties, recalls, lawsuits, etc),
-GM’s operations have ample – and unavoidable – commodity exposure (in both raw materials & the resulting impact on product demand/mix), and
-There’s no shortage of debt to consider.
Although that hardly represents a comprehensive accounting of the risks that crowd GM’s disclosures, it’s more than sufficient to obscure the many positives to be found under GM’s hood. Of particular note is GM’s strong showing across seemingly every facet of the changes looming over the broader automotive industry:
-Internal Combustion Engines (ICE): If you think all the talk about electric and/or autonomous vehicles is either total hogwash or still decades into the future . . . GM’s legacy business has you covered. For as long as consumers continue to demand ICE powered vehicles, GM will capably meet said demand. In fact, despite the many headwinds faced by the entire automotive industry in 2021, GM still capably sold ~6.3 million vehicles, and generated ~$113.6 billion of automotive-related revenues…” (Click here to see the full text)
